Euro Zone Economy Grows 0.4% in Q3, Cementing December Rate-Hike Bets
Updated
Updated · Reuters · Oct 30
Euro Zone Economy Grows 0.4% in Q3, Cementing December Rate-Hike Bets
3 articles · Updated · Reuters · Oct 30
Summary
The 21-country euro zone expanded 0.4% in the third quarter, beating the 0.2% Reuters poll forecast and topping expectations despite expensive energy and higher borrowing costs.
Annual growth reached 1.3% versus a 1.1% forecast, helped by investment in AI, defence and infrastructure, solid foreign demand and households drawing down savings to keep spending.
Germany grew 0.2%, Spain and the Netherlands 0.6%, Italy was flat and France contracted 0.1%, showing resilience at the bloc level even as major members diverged.
Inflation accelerated in most large euro zone economies, putting bloc-wide price growth on track for 3.9% or more and making another ECB rate hike in December appear almost certain.
Unemployment held at 6.5% in August, but rising benchmark and sovereign borrowing costs — especially pressure on France — leave the ECB warning that risks to growth are tilted lower.